Beverage Dynamics is the largest national business magazine devoted exclusively to the needs of off-premise beverage alcohol retailers, from single liquor stores to big box chains, through coverage of the latest trends in wine, beer and spirits.
Issue link: http://read.dmtmag.com/i/27652
sophisticated brands with quality credentials.” This idea of letting consumers “discover” brands on their own has really taken hold, especially among small- er brands that can boast about brewing history along with other unique product attributes. “We use a discovery marketing model for our imports,” said Heneman. “We want people to discover our brands. It could be a craft drinker looking for authenticity and heritage, or it could be a person into the latest style.” Corona, the top-selling import, is revisiting its successful “Win a Beach Getaway” promotion this year. upper income folks are not as affected by the downturn. We’re still bullish; we’re not predicting massive growth, but conditions were better in 2010, and we see more improvement in 2011.” Like the U.S. beer market as a whole, though, the import category consists of a couple of major players that make up the bulk of the market, and everybody else. Those big brands now tend to compete more directly with domestic mainstream brands, so they took a bigger hit than the rest of the category during the recession. “The major imports are going to have to continue what they’re already doing—aggressively cutting prices, rebating and promoting to recapture market share,” said George Witz, president of Lhasa Beer USA. “The current market is more price sensitive for long established brands, and the major imports are now competing head to head with mainstream labels as meaningful value alternatives.” Savvy Consumers espite some consumers’ willingness to pay higher prices for high-end beers, they also look for value propositions when they can. The sig- nificant growth of both the craft and imported beer seg- ments in the past 20 years has created a dramatic increase in both awareness and knowledge of beer-mak- ing, beer styles and brands. That growing sophistication has expanded beer drinkers’ repertoires to include a wide variety of beers, not just one or two. But their beer knowledge coupled with the economic uncertainty of the past two years has created a more value-conscious consumer. “The unstable economy has caused consumers to be more savvy in their purchase decisions, demanding more value, quality and variety,” said Sheila Stanziale, presi- dent of Diageo-Guinness USA. “Because of this, they are much more willing to experiment with new brands, prod- ucts from different regions and new flavors. We have been seeing these trends influence the beer category, and imports specifically. With this comes the increased inter- est we’ve seen in what I call the discovery category— “For imports, the potential is really in the smaller, more unique brands,” said George Witz, president of Lhasa Beer USA.. “That is where the real action and promise are. The demographic is shifting, and younger consumers are less inclined to drink their fathers’ beer than to go out and find their own. They are less price- sensitive when they are exploring the affordable luxury of new imports. So this is really a double advantage for the newer and smaller brands. They offer new experiences and also don’t have to be quite so aggressive on pricing.” The Right Fit hether through discovery marketing or more traditional marketing programs, brand building and establishing a rapport with con- sumers has become increasingly critical. “Repertoires are expanding and people are trying more and more beers, so brands are becom- ing more important,” said Steve Ward, vice president of national accounts for Heineken USA. “The top five craft/micro beers account for about 50% of sales in the segment despite a huge num- ber of brands. The top five imports account for about 80% of sales. We talk to retailers about the ‘upscale’ beer opportunity— micros, crafts, imports and domestic superpremiums—and what’s right for their market.” Brewers are getting smarter Heineken just debuted a new can, with a con- temporary look and a unique tac- tile feel. about focusing on markets where their brands will play well, rather than simply loading the distribution pipeline and hoping product will move. By offering a mix of products and packages that provide the greatest appeal, they hope to ultimately move more product, faster. “Consumers are collecting brands based on unique product propositions, from Bud Light Lime to Bohemia,” said Felix Palau, vice president of marketing for Bohemia and Tecate. “It’s all about differentiation; Beverage Dynamics • www.beveragedynamics.com • March/April 2011 • 67